Postal Reform: A Serious and Necessary Effort

Oct 12, 2011

Today [Thursday], the House Oversight and Government Reform Committee will markup the Postal Reform Act of 2011. This bold piece of legislation addresses the fiscal and structural crisis that the Postal Service faces today. The situation has become so dire that even after the Postmaster General took some unusual but necessary steps to cut costs, Congress still had to act to prevent them from defaulting on a $5.5 billion payment to their retirement benefit program. Worse still is that the delayed payment is due to the U.S. Treasury, potentially leaving taxpayers on the hook for a retirement program the Postal Service is legally required to pay for.

Several Representatives and Senators have proposed reducing USPS's financial obligations to its retirement accounts, effectively a bailout. However, this would release the one agency of the federal government that is required to fund their retirement and health care plans from that obligation. At a time when Congress is finally being forced to confront its long term liabilities, this is unacceptable.

Alternatively, Reps. Darrell Issa (R-CA) and Dennis Ross (R-FL) have proposed the sometimes politically unpalatable reforms that will steer the postal service back to sustainability. After the reforms, the USPS will be afforded more flexibility in business and labor decisions to respond to the precipitous decline in mail volume. The bill would create a solvency authority that would take over the postal service in the event there is a default allowing them to restructure. Ultimately, they will be prevented from defaulting on their obligations to the U.S. Treasury and taxpayer.

Reps. Issa and Ross should be applauded for their efforts. This is exactly the type of reform that is needed. The Postal Reform Act prevents this failing government entity from becoming a burden on all of us while improving its ability to fulfill the role it was constitutionally created to do -- however small that role is becoming.